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Small-medium businesses eligible for cash flow boo...

Small-medium businesses eligible for cash flow boosts

Small and medium businesses that employ staff will now be eligible to receive up to $100,000 in cash flow boosts, the Australian Taxation Office (ATO) has confirmed.

The cash flow boosts will be delivered as credits in the activity statement system. They will generally be equivalent to the amount withheld from wages paid to employees for each monthly or quarterly period from March to June 2020. In practice, this means you keep the amounts you have withheld from payments for these periods. However, there are some exceptions.

An additional cash flow boost will be applied when activity statements for each monthly or quarterly period from June to September 2020 are lodged. These credits are equal to the total boosts credited for March to June 2020. They will be paid out in either two or four instalments depending on your reporting cycle.

The initial cash flow boost will be equal to 100 per cent of the amount of tax withheld on each employee’s salary and wages, with exceptions.

According to the ATO, the cash flow boosts will be delivered as credits in the activity statement system, and will be applied to reduce liabilities arising from the same statement.

“They will generally be equivalent to the amount withheld from wages paid to employees for each monthly or quarterly period from March to June 2020,” the ATO stated.

“In practice, this means you keep the amounts you have withheld from payments for these periods.”

Excess credit from the activity statement that received the cash flow boost amount will be refunded to the business, rather than offset against any other tax debts.


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